ADB forecasts 7.2pc economic growth for developing Asia

Developing Asia’s economic growth this year will be slightly lower than previously projected, the Manila-based Asian Development Bank said on Tuesday, citing the resurgence of Covid-19 infections in countries.

The ADB said recovery was underway in “developing Asia”, referring to the bank’s 46 members, including China and India, but growth was revised down to 7.2 per cent from 7.3 per cent projected in its Asian Development Outlook (ADO) report released in April.

The bloc’s combined economy was projected to expand 5.4 per cent next year, compared with the April forecast of 5.3 per cent.

“Asia and the Pacific’s recovery from the Covid-19 pandemic continues, although the path remains precarious amid renewed outbreaks, new virus variants, and an uneven vaccine rollout,” ADB Chief Economist Yasuyuki Sawada said.

In its ADO supplement, the ADB maintained its growth forecasts for China at 8.1 per cent this year and 5.5 per cent next year.

But it revised growth forecasts for India to 10 per cent this year and 7.5 per cent next year, compared with the April projections of 11 per cent and 7.0 per cent, respectively.

In Southeast Asia, the ADB revised 2021 growth forecasts to 4.1 per cent from 4.5 per cent for Indonesia; 2.0 per cent from 3.0 per cent for Thailand; 5.5 per cent from 6.0 per cent for Malaysia; and 5.8 per cent from 6.7 per cent for Vietnam.

It raised Singapore’s growth projection for this year to 6.3 per cent from 6.0 per cent, but kept the growth outlook for the Philippines at 4.5 per cent.

For the year 2022, the ADB maintained its growth forecasts for most Southeast Asian economies: 5.0 per cent for Indonesia, 5.7 per cent for Malaysia, 5.5 per cent for the Philippines, 4.1 per cent for Singapore, and 7.0 per cent for Vietnam.

But it raised the growth projection for Thailand to 4.9 per cent for next year from 4.5 per cent.

“On top of containment and vaccination measures, phased and strategic rejuvenation of economic activities - for instance, trade, manufacturing, and tourism - will be key to ensure that the recovery is green, inclusive, and resilient,” Sawada said.